The U.S. SEC has approved options trading for several Bitcoin spot ETFs, and analysts expect this will increase Bitcoin's market volatility. Retail investors are likely to use Bitcoin ETF options for speculation, which could amplify price fluctuations. Institutional market makers are expected to become the counterparties for these trades. Galaxy Digital's head of franchise trading anticipates that volatility will intensify in the short term. The Cboe Exchange and NYSE American have been authorized to list multiple Bitcoin ETF options products, with a single-side position limit of 25 thousand contracts.

Odaily Planet Daily reports that the U.S. SEC has approved options trading for multiple Bitcoin spot ETFs, and analysts expect this will increase market volatility for Bitcoin. Ed Tolson, CEO of Kbit, believes that retail investors will use Bitcoin ETF options for speculation, which may amplify price fluctuations. "Retail speculation is likely to be a primary use case for BlackRock's IBIT options, with institutional market makers expected to be the counterparties in these trades. This means they will need to buy when prices rise and sell when prices fall, which could exacerbate volatility." 

Michael Harvey, head of trading at Galaxy Digital, also anticipates increased volatility in the short term, stating, "We expect the number of retail traders to initially surpass that of institutions, which may heighten volatility. Over time, as institutions adopt yield-generating strategies, such as selling volatility, this may dampen the overall volatility we see today." (The Block)

Yesterday, the U.S. Securities and Exchange Commission (SEC) approved the listing of several Bitcoin ETF options products on the Cboe Exchange and NYSE American. Cboe has been authorized to list options for the Fidelity Wise Origin Bitcoin Fund (FBTC) and ARK 21Shares Bitcoin ETF (ARKB); NYSE American has been authorized to list options for Grayscale Bitcoin Trust ETF (GBTC), Grayscale Bitcoin Mini Trust (BTC), and Bitwise Bitcoin ETF (BITB). According to the documents, both exchanges have set a single-position limit of 25 thousand contracts for each Bitcoin ETF option, which is lower than that for other ETF options products.

The approval of Bitcoin ETF options will increase market volatility in the short term.